Land Value Taxation will solve many of the 21st century's most serious social, economic and environmental problems, and promote justice, fairness and sustainability. We CAN have a world in which all can prosper.

Search

Pages I refer to often

Progress and Poverty, by Henry GeorgeHere are links to online editions of George's landmark book, Progress & Poverty, including audio and a number of abridgments -- the shortest is 30 words! I commend this book to your attention, if you are concerned about economic justice, poverty, sprawl, energy use, pollution, wages, housing affordability. Its observations will change how you approach all these problems. A mind-opening experience!

Books I Value

Henry George: Progress and Poverty: An inquiry into the cause of industrial depressions and of increase of want with increase of wealth ... The RemedyThis is perhaps the most important book ever written on the subjects of poverty, political economy, how we might live together in a society dedicated to the ideals Americans claim to believe are self-evident. It will provide you new lenses through which to view many of our most serious problems and how we might go about solving them: poverty, sprawl, long commutes, despoilation of the environment, housing affordability, wealth concentration, income concentration, concentration of power, low wages, etc. Read it online, or in hardcopy.

Bob Drake's abridgement of Henry George's original: Progress and Poverty: Why There Are Recessions and Poverty Amid Plenty -- And What To Do About It!This is a very readable thought-by-thought updating of Henry George's longer book, written in the language of a newsweekly. A fine way to get to know Henry George's ideas. Available online at progressandpoverty.org and http://www.henrygeorge.org/pcontents.htm

Where Else Might You Look?

Wealth and WantThe URL comes from the subtitle to Progress & Poverty -- and the goal is widely shared prosperity in the 21st century. How do we get there from here? A roadmap and a reference source.

Reforming the Property Tax for the Common GoodI'm a tax reform activist who seeks to promote fairness and reduce poverty. Let's start with the enabling legislation and state requirements for the property tax. There are opportunities for great good!

Notes

11 posts categorized "natural monopolies"

January 24, 2013

I'm skimming Louis Post's book "Social Service" (1909) and came across a couple of elegant paragraphs about Laissez faire.

Doesn't unrestricted competition mean to let everybody alone? That
depends upon what you mean by letting alone. It does not mean to let
everybody or anybody alone to interfere with production, with
rendering
service, with industry. Such interferences, whether by government or
by
highwaymen, are precisely what ought to be stopped in the interest
of
unrestricted competition. Unrestricted competition does mean that
everybody should be let alone in production, in trade, in service,
in
usefulness to his fellows, in making the world better and richer,
and
in securing a fair distribution of service among those who render
service.

Truly enough, "laissez faire" is the word — "let alone," that is the
watchword of competition. But it isn't all of it. As the old
democratic
economists of France put it — those preceptors of Adam Smith — it
was
"laissez faire, laissez aller." Now, how would you translate that,
Doctor? Don't you think that George's free translation of "a fair
field
and no favor" will do? Or we might make it "a square deal and no
odds,"
or best of all, maybe, "equal rights and no privileges."

There is no competition in the policy of "let alone," unless you
abolish privileges. But with equal rights and no privileges, can you
imagine anything fairer or squarer or juster in industry, in trade,
in
social service, than the policy of "let alone"? This doesn't mean a
"struggle for existence and survival of the fittest" in the sense of
survival of the strong at the expense of the weak, nor even of
survival
of the more productive at the expense of the less productive. It
means
fair distribution in proportion to production. It means that he who
renders the most and the best service in his specialty shall get the
most and the best service from other specializers, while those who
render the least and the poorest shall nevertheless get the
equivalent
of what they do render. And it leaves the decision to those who in
equal freedom make the deal for the service.

Competition is the natural regulator of the law of the line of least
resistance. Without such regulation that law might stimulate the
strongest — not the strongest in rendering service, but the
strongest
in
extorting service — to get service without giving an equivalent
service
of his own. There is your savage "tooth and claw" condition, Doctor.
But under free competition this would be impossible, for free
competition restrains the individual desires of each by the
opposition
of the individual desires of others. In other words, competition
tends
to produce an equilibrium of the self-serving impulse at the most
useful level of social service.

It is a word of confusing connotations, this word "competition," as
are
all living words; and it may not be the best word for conveying my
idea. But I can't manufacture words, Doctor. All I can do is to make
unto myself a definition, and always to use my word in that sense;
and
all I can ask you to do is to adopt my definitions when you try to
understand my discourse.

Though competition may not be quite synonymous with natural
co-operation, it is closely related to it, and in such a manner as
to
justify me, I think, in characterizing it as the life principle of
natural co-operation.

Monopoly, on the other hand, whether its purpose be malevolent or
benevolent, is the death principle of natural co-operation.

So it seems to me that you will grasp the significance of
competition
best by contrasting it with monopoly.

To sum it all up, there are only two ways of regulating co-operative
service, that social service which springs from individual desires
for
selfservice. One way is by monopoly; the other is by free
competition.
Monopoly is pathological, and socially destructive; competition is
natural, and socially creative.

Louis F. Post was editor of Henry George's weekly newspaper, The Standard, for a year or so, and went on to edit The Public for a number of years, and then became an Assistant Secretary of Labor in Woodrow Wilson's administration.

November 15, 2012

Pigou, a key bridge figure in the history of his field, was one of the earliest classical economists to notice that markets do not always produce the best possible social outcomes. The pollution generated by a factory imposes costs on those who live downstream or in the path of its airborne emissions. The risks assumed by banks leading up to the recent financial crisis imposed costs on just about everybody. Market transactions often generate what economists call “externalities” — side effects, sometimes positive but often negative, that affect people who do not participate in the transaction.

Pigou, having recognized the problem, was the first to propose a solution. Society should tax the negative externalities and subsidize the positive ones. This simple notion — if you want less of something, tax it — is why his ideas periodically bubble up in the service of combating a recognizable cost to society, like pollution. We think that his approach offers an answer to another great problem of our time: inequality.

Does the extreme degree of inequality in America today really create, as Pigou would put it, negative externalities? Does the fact that hedge-fund manager Mr. Jones rakes in 100 or 1,000 times what office manager Mrs. Smith earns impose costs on everybody else? Plenty of Americans think not. Defenders of our skewed income distribution point out that a free-enterprise system requires some inequality. Unequal rewards give people an incentive to work hard and acquire new skills. They encourage inventors to invent, entrepreneurs to start companies, investors to take risks. It’s fine in this view that some people get astronomically rich. As Mitt Romney likes to say, “I’m not going to apologize for being successful.”

On the other side, many of us have a gut feeling that inequality has gone too far. Our times are reminiscent of the Gilded Age’s worst excesses. Hence the popularity of the Occupy Wall Street movement’s slogan, “We are the 99 percent.”

LVTfan here: Wouldn't it be better to prevent the inequality by such measures as treating the natural creation as our common treasure, instead of permitting its privatization and then taxing back what is taken? Treating the natural creation, and that which the community creates by its presence and its investment in public goods -- schools, roads, libraries, etc. -- as our COMMON treasure would create equal opportunity for all, a much better idea than permitting some to capture it and then taxing some of their booty back after the fact. When we let some reap what others sow, and then take back a share after the fact, we're still permitting them to reap which deprives the sowers of that right. Whether it be nature doing the sowing, or the community as a whole, no good can come of permitting the privatization of that. Henry George, in "Progress and Poverty" and "Social Problems" showed the logical, efficient, just way to do better.

October 21, 2012

Henry George is the most famous American popular economist you've never heard of, a 19th century cross between Michael Lewis, Howard Dean and Ron Paul. Progress and Poverty, George's most important book, sold three million copies and was translated into German, French, Dutch, Swedish, Danish, Spanish, Russian, Hungarian, Hebrew and Mandarin. During his lifetime, George was probably the third best-known American, eclipsed only by Thomas Edison and Mark Twain. He was admired by the foreign luminaries of the age, too -- Leo Tolstoy, Sun-Yat Sen and Albert Einstein, who wrote that "men like Henry George are unfortunately rare. One cannot image a more beautiful combination of intellectual keenness, artistic form and fervent love of justice." George Bernard Shaw described his own thinking about the political economy as a continuation of the ideas of George, whom he had once heard deliver a speech.

Later, she writes,

What
George found most mysterious about the economic consequences of the
industrial revolution was that its failure to deliver economic
prosperity was not uniform -- instead it had created a winner-take-all
society: "Some get an infinitely better and easier living, but others
find it hard to get a living at all. The 'tramp' comes with the
locomotives, and almshouses and prisons are as surely the marks of
'material progress' as are costly dwellings, rich warehouses and
magnificent churches. Upon streets lighted with gas and patrolled by
uniformed policeman, beggars wait for the passer-by, and in the shadow
of college, and library, and museum, are gathering the more hideous Huns
and fiercer Vandals of whom Macaulay prophesied."

George's
diagnosis was beguilingly simple -- the fruits of innovation weren't
widely shared because they were going to the landlords. This was a very
American indictment of industrial capitalism: at a time when Marx was
responding to Europe's version of progress and poverty with a wholesale
denunciation of private property, George was an enthusiastic supporter
of industry, free trade and a limited role for government. His culprits
were the rentier rich, the landowners who profited hugely from
industrialization and urbanization, but did not contribute to it.

George
had such tremendous popular appeal because he addressed the obvious
inequity of 19th century American capitalism without disavowing
capitalism itself. George wasn't trying to build a communist utopia. His
campaign promise was to rescue America from the clutches of the robber
barons and to return it to "the democracy of Thomas Jefferson." That
ideal -- as much Tea Party as Occupy Wall Street -- won support not only
among working class voters and their leaders, like Samuel Gompers, but
also resonated with many small businessmen. Robert Ingersoll, a
Republican orator, attorney and intellectual, was a George supporter. He
urged his fellow Republicans to back his man and thereby "show that
their sympathies are not given to bankers, corporations and
millionaires."

I commend the entire post, adapted from Freeland's new book, Plutocrats. It ends with these paragraphs:

"America
today urgently needs a 21st century Henry George -- a thinker who
embraces the wealth-creating power of capitalism, but squarely faces the
inequity of its current manifestation. That kind of thinking is missing
on the right, which is still relying on Reagan-era trickle-down
economics and hopes complaints about income inequality can be silenced
with accusations of class war. But the left isn't doing much better
either, preferring nostalgia for the high-wage, medium-skill
manufacturing jobs of the post-war era and China-bashing to a serious
and original effort to figure out how to make 21st century capitalism
work for the middle class.

Globalization
and the technology revolution aren't going away -- and thank goodness
for that. Industrialization didn't go away either. But between 1886,
when George lost the mayoral race, and the presidency of FDR, American
progressives invented, fought for and implemented a broad range of new
social and political institutions to make capitalism serve the whole of
society -- ranging from trust-busting, to the income tax, to the welfare
state.

We
are living in an era of comparably tumultuous economic change. The
great challenge of our time is to devise the new social and political
institutions we need to make the new economy work for everyone. So far,
that is a historic task neither party is taking on with enough energy,
honesty or originality."

Along the same lines, you might find interesting an earlier post here, an article by Thomas Shearman entitled "Henry George's Mistakes." (He was a co-founder of Shearman & Sterling, and went on to write some excellent articles on plutocracy in The Standard, October, 1887.)

August 22, 2012

As I listen to the 2012 party platforms, I am reminded of what they ought to be focused on, embodied pretty well in this platform from 1886-87.

PLATFORM OF THE UNITED PARTY.
Adopted at Syracuse August 19, 1887.

We, the delegates of the united labor party of New York, in state
convention assembled, hereby reassert, as the fundamental platform of
the party, and the basis on which we ask the co-operation of citizens of
other states, the following declaration or principles adopted on
September 23, 1886, by the convention of trade and labor associations of
the city of New York, that resulted in the formation of the united
labor party.

"Holding that the corruptions of government and the impoverishment of
labor result from neglect of the self-evident truths proclaimed by the
founders of this republic that all men are created equal and are endowed
by their Creator with unalienable rights, we aim at the abolition of a
system which compels men to pay their fellow creatures for the use of
God’s gifts to all, and permits monopolizers to deprive labor of natural
opportunities for employment, thus filling the land with tramps and
paupers and bringing about an unnatural competition which tends to
reduce wages to starvation rates and to make the wealth producer the
industrial slave of those who grow rich by his toil.

'“Holding, moreover, that the advantages arising from social growth and
improvement belong to society at large, we aim at the abolition of the
system which makes such beneficent inventions as the railroad and
telegraph a means for the oppression of the people and the
aggrandizement of an aristocracy of wealth and power. We declare the
true purpose of government to be the maintenance of that sacred right of
property which gives to every one opportunity to employ his labor, and
security that he shall enjoy its fruits; to prevent the strong from
oppressing the weak, and the unscrupulous from robbing the honest; and
to do for the equal benefit of all such things as can be better done by
organized society than by individuals; and we aim at the abolition of
all laws which give to any class of citizens advantages, either
judicial, financial, industrial or political, that are not equally
shared by all others."

We call upon all who seek the emancipation of labor, and who would make
the American union and its component states democratic commonwealths of
really free and independent citizens, to ignore all minor differences
and join with us in organizing a great national party on this broad
platform of natural rights and equal justice. We do not aim at securing
any forced equality in the distribution of wealth. We do not propose
that the state shall attempt to control production, conduct
distribution, or in any wise interfere with the freedom of the
individual to use his labor or capital in any way that may seem proper
to him and that will not interfere with the equal rights of others. Nor
do we propose that the state shall take possession of land and either
work it or rent it out. What we propose is not the disturbing of any man
in his holding or title, but by abolishing all taxes on industry or its
products, to leave to the producer the full fruits of his exertion and
by the taxation of land values, exclusive or improvements, to devote to
the common use and benefit those values, which, arising not from the
exertion of the individual, but from the growth of society, belong
justly to the community as a whole. This increased taxation of land, not
according to its area, but according to its value, must, while
relieving the working farmer and small homestead owner of the undue
burdens now imposed upon them, make it unprofitable to hold land for
speculation, and thus throw open abundant opportunities for the
employment of labor and the building up of homes.

While thus simplifying government by doing away with the horde of
officials required by the present system of taxation and with its
incentives to fraud and corruption, we would further promote the common
weal and further secure the equal rights of all, by placing under public
control such agencies as are in their nature monopolies: We would have
our municipalities supply their inhabitants with water, light and heat;
we would have the general government issue all money, without the
intervention of banks; we would add a postal telegraph system and postal
savings banks to the postal service, and would assume public control
and ownership of those iron roads which have become the highways of
modern commerce.

While declaring the foregoing to be the fundamental principles and aims
of the united labor party, and while conscious that no reform can give
effectual and permanent relief to labor that does not involve the legal
recognition of equal rights, to natural opportunities, we nevertheless,
as measures of relief from some of the evil effects of ignoring those
rights, favor such legislation as may tend to reduce the hours of labor,
to prevent the employment of children of tender years, to avoid the
competition of convict labor with honest industry, to secure the
sanitary inspection of tenements, factories and mines, and to put an end
to the abuse of conspiracy laws.

We desire also to so simplify the procedure of our courts and diminish
the expense of legal proceedings, that the poor may be placed on an
equality with the rich and the long delays winch now result in
scandalous miscarriages of justice may be prevented.

And since the ballot is the only means by which in our Republic the
redress of political and social grievances is to besought, we especially
and emphatically declare for the adoption of what is known as the
“Australian system of voting,” an order that the effectual secrecy of
the ballot and the relief of candidates for public office from the heavy
expenses now imposed upon them, may prevent bribery and intimidation,
do away with practical discriminations in favor of the rich and
unscrupulous, and lessen the pernicious influence of money in politics.

In support or these aims we solicit the co-operation of all patriotic
citizens who, sick of the degradation of politics, desire by
constitutional methods to establish justice, to preserve liberty, to
extend the spirit of fraternity, and to elevate humanity.

The following list comprises the most commonly asked questions about the concept of making land and resource rentals the source of revenue for government. As you continue this study, you will see the value from giving resources the respect they deserve and the benefits resulting from the freeing of labour, production and exchange from taxation. If you have any questions which are not covered here, or observations you would like to put to our panel, please feel free to do so by sending your question as an e-mail query and we will attempt to respond.

The inclusion of land and resources in the economic equation is central to any solution for revenue raising. A taxation solution which does not consider the nature of taxation itself and allows the continuing private monopolisation of community land and resources fails to recognise the essential role land plays in the economic equation and will not work. Land is the only element in the economic equation which is both fixed and finite. It can be monopolised. It is a unique class of asset which must be treated accordingly. If we were to wrest not the land itself, but its unimproved value from private monopolies and return the value to the community — whose very presence creates it — then we would have reduced many problems in one stroke with great benefit to production, to the environment and to the cause of individual freedom and justice.

On the subject of land and resource rents, Henry George said this:

The tax upon land values is the most just and equal of all taxes. It falls upon those who receive from society a peculiar and valuable benefit, and upon them in proportion to the benefit they receive. It is the taking by the community, for the use of the community, of that value which is the creation of the community. It is the application of the common property to common uses. When all rent is taken by taxation for the needs of the community, then will the equality ordained by nature be attained.

February 13, 2012

13. Electric utilities have long been regarded as "widows' and orphans'" stocks. Safe, if not high income. A few years ago, they were deregulated. A recent study has shown that retail electricity prices have increased faster in states that adopted competitive pricing than in those where rates continue to be set by government agencies. We all need reliable electricity. Should we permit the licenses to generate and distribute electricity to be an opportunity to make a windfall profit? (Or should we encourage municipal ownership of vital utilities?)

A. Sure! People and businesses are quite free to move from states without regulation to states with regulation if they choose. They may not mind paying 20% more for their electricity, if other conditions are good. And didn't the utilities earn it?

B. Sure. If local regulatory agencies decide that local best interests conflict with the interests of the corporate shareholders, they can re-regulate. After all, the corporations don't vote.

C. No. Electricity is important and we ought to do what we can to keep the price down so that poor people can afford electricity and still have funds for other costs of living.

D. No. Electricity is vital to the economy, and we ought to do what we can to keep it affordable to ordinary people, and not a source of corporate windfalls.

E. No. Natural monopolies ought to be publicly owned, the prices kept low, and any excess revenue accrue to the public treasury, not to the benefit of private investors.

February 12, 2012

12. Foreign corporations own the water utilities in parts of New England. Often these companies came with significant acreage on picturesque reservoirs, some within easy commuting distance of New York City. Water is a vital resource, and the infrastructure which supplies it and cleans it is vital to everyone. In other places, including NYC, municipal utilities supply the water. Is private ownership of the water supply acceptable?

A. Sure! Why not?

B. As long as it is regulated by stong public utility commissions

C. No, this should be a public function.

D. Private ownership is fine, as long as it is American corporations. They'll take care of us, and not overcharge us.

E. This is a natural monopoly situation, and rightly should be owned by the local, county or state government, or some local public entity. Clean water is too important to leave to the private sector, even where the supply is abundant.

December 18, 2011

When the structures that our laws and traditions create provide opportunities for someone to capture a windfall, should we blame the fellow who "takes advantage" of those structures, or should we respond by studying and correcting those structures and laws?

Winston Churchill, in his speeches under the baanner "The People's Rights," in 1909, said this:

I hope you will understand that when I speak of the land monopolist I am dealing more with the process than with the individual landowner. I have no wish to hold any class up to public disapprobation. I do not think that the man who makes money by unearned increment in land is morally a worse man than anyone else who gathers his profit where he finds it in this hard world under the law and according to common usage. It is not the individual I attack, it is the system. It is not the man who is bad, it is the law which is bad. It is not the man who is blameworthy for doing what the law allows and what other men do; it is the State which would be blameworthy were it not to endeavour to reform the law and correct the practice. We do not want to punish the landlord. We want to alter the law.

The 99% need to start identifying the laws and structures that must be adjusted. This is not easy work.

What individuals produce, and corporations produce, should not be "there for the taking" -- be it by corporate management in the form of hugely generous compensation packages and golden parachutes, or by simply saying "these resources are OURS, not everyone's" or by establishing monopolies or duopolies or other such structures. We-the-people need to educate ourselves about how things are done now, who benefits from that, and what alternatives exist. It won't be easy. We'll be challenging special interests who somehow think they're entitled to their advantaged positions, and the rest of us exist to keep them comfortable.

Labor should get its share, and capital should get its share, and we-the-people should get land's share. That last could fund a large portion of our common spending, on infrastructure and services, and permit us to reduce or eliminate the dumb taxes which take which individuals and corporations legitimately create. That "keeping what we create" extends, also, to "externalities," to being responsible for the pollution we create, and setting up incentives so that it is minimized, for the good of all of us now here and the good of future generations.

I think it is quite possible, even likely, that a few years after we've made this shift in who gets what, we'll find that we don't need nearly so robust a social safety net, and that we-the-people may get some of "land's share" back in the form of a Citizen's Dividend, just as all permanent residents of Alaska receive an annual dividend from the Alaska Permanent Fund.

In any case, letting some corporations and some individuals grab that which we all create together is just plain wrong. Letting it be "there for the taking" is insanity and injustice. And don't we pledge "liberty and justice for all?"

Our ancestors may have granted some privileges to some lucky folks for one reason or another. That doesn't mean that we can't, politely and firmly, revoke those privileges. A couple of centuries is plenty. Experience has shown us that those privileges don't serve the greater good, and it is time to revoke them. Will the privileged give up those privileges graciously? Quite possibly not. But the first step is to identify them, and then to seek to change the system so that those rightly-common assets aren't "there for the taking."

Pointing to the recent declines at the top, Mr. Kaplan argues the Occupy protesters have accused the wrong villain by focusing on inequality, which he called an inevitable byproduct of growth. “If you want to reduce inequality, all you need to do is put the economy in a recession,” he said. “If you want the economy to do well, as all of us do, then you’ll get more inequality.”

Well, maybe at the University of Chicago, that is what is taught, but is it true?

It may be inevitable under our current structures, but if one gets outside that box, and looks deeper, one finds other answers.

I would suggest that Mr. Kaplan, who teaches economics at the Graduate School of Business at the U of C, look beyond the interests of the university's and b-school's founders and big donors and alumni and current students, and consider that we're all in this together, and that when we permit a few to monopolize and privatize things which rightly are our common treasure, inequality is the inevitable byproduct.

Mr. Kaplan might start by exploring the ideas of Henry George. They were in his freshman economics texts, but most likely his instructor didn't lecture on them, or include them in exams (most likely because his own instructors hadn't!)

Read what those textbooks have to say, and then think about whether it is in Mr. Kaplan's personal career interests to speak of an idea that could rock the yachts of alumni and donors and others who like our current structures just fine, thank you! The privileged like their privileges, and would prefer that we not notice that they are privileges, or, if we do notice, think that THEIR privileges are somehow in OUR best interests.

November 28, 2011

Paul Krugman's column in the NYT Sunday was entitled "Things to Tax," and I thought it was a bit broad-brush.

Krugman wrote,

"Let me suggest two areas in which it would make a lot of sense to raise taxes in earnest, not just return them to pre-Bush levels: taxes on very high incomes and taxes on financial transactions."

I don't disagree with either of those as a starting point, but neither goes to the root of the problem, which I believe to be the sorts of privileges we have given out, or somebody's ancestors put in place and we've not even thought about questioning. They are so familiar to us that we don't question them any more than we think about breathing. So (switching metaphors) we find ourselves barking loudly up the wrong tree -- while the critters in the other trees are smiling broadly!

The best answers I know to which tree we ought to be barking up come from the writings of Henry George. Several speeches were what I was first inspired by:

Whether or not your own orientation is theological, I think you might appreciate these.

We ought not to be taxing indiscriminately. What we tax matters greatly. Some provide Natural Public Revenue -- and we ought to socialize that revenue -- and other possible objects of taxation ought not to be taxed at all -- privatize them!

Should we tax the ones who have bought or inherited or otherwise acquired our very choicest land -- that in our biggest cities, well-served by taxpayer-provided infrastructure and services?

Should we tax the ones who, in effect, own our most valuable natural resources, or have access to resources we send our military to protect on our behalf?

Should we tax those who benefit from monopolies of various kinds, such as owning our water companies, our electric utilities, our cable-tv companies, or monopolies of their own creation?

Should we tax those who benefit from privileges of various kinds, such as the possession of our airwaves, landing/takeoff rights at busy constrained airports (think LGA at rush hour)?

Should we tax those who benefit by taking some fraction of every financial transaction, even if that transaction doesn't create additional value for the economy as a whole?

Should we tax those who benefit from the activity or inactivity of the FIRE sector, which Joe Stigitz says is creaming 40% of the profits made by the productive sectors of the economy?

Or should we just tax all the high-income people, without going to the root of the privileges which produce undeserved wealth for some at the expense of the rest of us.

The answers to these questions matter.

Go to the root. Understand what is privilege, and what is an actual contribution to the economy. Understand what is someone's free lunch, paid for by the labor of others. Understand who reaps what they haven't sown. Correct these things.

An old idea. Look up Henry George's writings from the late 19th century, which kicked off the Progressive movement and still inspire many of us.

Short term, maybe, changing the income tax brackets is appropriate. But it doesn't get at the root of the problem.

November 27, 2011

This appeared in an 1896 California weekly called the San Jose Letter. It makes the distinction between the intent of the Single Tax, which is decidedly individualistic, and Socialism, which is not. (Many people, when they first hear about collecting rent to fund government, jump to a conclusion that it is somehow socialistic. It does socialize something we are used to treating as private property, but those who stop to think it through will see the logic and justice of socializing that which the community creates, particularly so because it makes it possible to privatize that which is rightly private: that which the individual creates.)

Single Tax vs. Socialism

The idea of socialism is based upon the theory that each person should have an equal share of all that is produced, irrespective of what the person produces. Lawrence Grunland wishes to make modifications in that plan by establishing grades according to the different kinds of work,but to that extent is he compromising with our present system and discountenancing ideal socialism.

The theory is summed up in their demand that "all means of production and distribution be owned and operated by the government," as the chief plank of their platform. As every person who works intelligently is employed in either production or distribution, every one would be in the employ ol the Government.

The curse of the race today is the concentration of power in a few hands. It was concentration of power that made slaves of nearly all the people of Egypt, of Rome, and the same is being repeated today. And yet the socialists want to enter upon such a system of concentration as the world has never seen.

But it is claimed that the people would choose their own overseers. The people of San Francisco, of Chicago, of New York, elect the members of the city councils, but who would want to place in the hands of these men the control of all the means of production and distribution — the management of every conceivable line of business and pursuit — and consequently the wages that shall be paid in the different grades, the hours of work, and also the assignment of the kinds of work that each one shall do. Pause a moment and think of the rings that must of necessity spring up under such a system. Or who would want to place in the hands of Grover Cleveland the destiny of the 70,000,000 people of the United States? The president now has more power than any human being should be entrusted with, but it is not a drop in the ocean compared to the power he would have under the co-operative commonwealth.

Instead of giving our government heads and legislative bodies more power, we need to curtail them in that which they already have. Give the people of the smallest political divisions local option in taxation and other matters to the fullest extent possible, and take from Congress the power to build up one industry or one section at the expense of another, under the guise of raising revenue or protecting certain grades from competition, and they, the people, will soon learn what is best for them, for, by experiments, that which proves to be the best for one will be adopted by others.

One of the proper functions of government is to own and operate natural monopolies, because individuals or corporations will not operate them for the benefit of the public where it conflicts with their own interests. But because the government should own and operate a natural monopoly, such as the telegraph, where in the very nature of things there can be no real competition that is no reason why the government should own and operate the bake shops, the barber shops, and the truck gardens.

In opposition to the claim that "each is entitled to an equal share of all that is produced, irrespective of what he produces," I claim that each is entitled to all that his labor produces and no more, and that the community should take for governmental expenses that which the community produces and no more, viz.: land values.

Judge Maguire of San Francisco, in the course of a speech in congress, said: "There is a natural right of ownership existing between everything produced by labor and the labor that produced it. That right springs from every man's ownership of himself and of his mental and physical powers. Owning himself, he has a natural right of ownership in the things and values that his own mental and physical powers produce, and he can manifestly, without violating any principle of natural justice, transfer his right in such things to another upon any terms which may be satisfactory to him. This is a matter with which neither society at large nor any individual can properly have any concern. The things that he produces are his, because he has produced them; because their forms of utility would not have existed but for his productive effort, and it is no hardship to any other man in the world to be deprived of that which would not have existed at all but for the labor of him who produced it.

"If the labor of a dozen men indisguishably contributes to the production of anything of value, it belongs, by the same law, not to any one of them, but to the whole dozen. So, if a value be produced by the indistinguishable labor of a community of one hundred thousand or a million people, it belongs by the same law of natural right to all, and not to any individual, or to any number less than the whole. Therefore the rental value of land belongs to the community which produces and maintains it by the same natural right which gives to each individual man the wealth which his labor entirely produces."

To give this practical effect, the single taxers would take all taxes off labor and labor's products and put them upon land values. This would make it unprofitable for individuals to hold large tracts of land unused — in fact impossible, as the taxes on large tracts of idle land would soon eat up all the owner's income from the other sources. The Miller & Lux estate, comprising 14,500,000 acres, which includes more than one-fourth of the arable land of the state of California, is almost wholly unused. Under the single tax, this would soon be open to the people who actually wanted to use it, and every man in the state who wanted a home and a place to make a living could have one. Fully nineteen-twentieths of the arable land of California is unused or nearly so.

By our indirect manner of raising government revenue each producing family pays $40 yearly government tax; $40 of protected monopoly tax in higher prices for goods, and $80 per year that is now taken to pay dividends on watered stocks in railroads, telegraph and kindred monopolies. All these as well as state and county taxes would be done away with, except on land values irrespective of improvements. This would make land freer to labor than it was in California forty years ago; freer than it was on the Atlantic seaboard two hundred years ago. With the land open to all, none need to work for another for less wages than his labor is worth. Under such conditions who need be in want?

Karl Marx, the noted socialist, relates the incident of a rich English capitalist conveying to one of the British colonies a vast store of machinery and materials for the establishment of a great factory, together with three thousand people of the working class — men, women and children — to work in the projected factory. How immediately after landing at their destination, men, women and children left him without so much as a servant to carry water from the river to cook a meal; left him and his machinery; and the machinery lay and rotted on the ground and the factory was never erected. Why did they leave him? The same inducement that brought him and his capital from the shores of "Merrie England" — they could get free land, all they wanted of it, for the taking. With land free to use capital can not oppress labor, and the single tax would make land free to use.